When some businesses think of employee benefits, they think of what’s covered and how much does it cost? Although these are important factors, benefit programs require pro-active management from an administration, claims management, financial, governance, and employee communication perspective. It can also be common practice to view a benefits broker as simply a conduit to gain access to a benefit plan. This limited perception may be due to the following:

The assumption that a group benefits broker is similar to a car/home insurance broker, which is not the case.

After initial set up of your benefit plan, you have little to no contact with your broker and contact the insurer when you have questions or concerns.

Since all benefit brokers work with most insurance carriers and those insurers can offer a comprehensive suite of benefits and products, organizations should ask themselves the following questions when evaluating a benefit broker, advisor, or consultant:

Does my consultant have the experience, expertise and education to manage my benefit program in a cost-effective manner within the terms of our benefit contract and administrative policies?

Is my consultant a Certified Employee Benefits Specialist (CEBS)? This is a professional designation achieved in partnership with Dalhousie University and the International Foundation of Employees Benefits and Pensions (IFEBP) and is the premier education for benefit professionals.

Does my consultant fully disclose his remuneration and all other financial details of my group benefit policy?

Does my consultant have a strong service team who respond quickly and effectively to questions and concerns?

Does my consultant negotiate my annual renewal rates before we meet and is able to explain in detail why and how rate adjustments were made? Do they provide their rate analysis and calculations?

Does my consultant assist and support with the development and implementation of internal benefit related policies? E.g. Extension of benefits, mandatory participation, salary continuance, life conversion communication upon employee terminations.

To follow is an overview of the services offered by benefit consultants versus those commonly provided by benefit brokers:

Benefit Broker

Benefit Consultant / Advisor

“A person who functions as an intermediary between two or more parties”

Access to multiple insurers

Emphasis on rates & plan design

Limited disclosure

Limited reporting

Limited points of contact throughout the year

Limited or no specialized education

Basic level of services and support

“A person who gives professional or expert advice”

Access to multiple insurers

Experts on pricing, underwriting, and actuarial principles/practices

Negotiates annual renewal rates

Provides detailed analysis and reporting

Benefits related education i.e. CEBS

Full disclosure, including commission

Focus on benefit governance

Complex claims assistance

Benefit benchmarking

Experience with ASO & Refund Accounting

Comprehensive needs analysis

3-5 year benefit strategy

Employee communication

Flex benefits

Comprehensive level of service

Multiple service contracts throughout the year

Utilization updates

Are you receiving the full level of service that an experienced benefit consultant provides? If your broker only offers a few of these services it may be time to make the switch. A good consultant will provide a superior level of service and expertise at the same commission level as your current broker, if not lower. You do not have to change benefit providers to change advisors, a simple appointment letter on company letterhead is all you need. For more information and to use our detailed advisor evaluation tool, please contact us.